Last Updated on Tuesday, 5 July, 2022 at 12:30 pm by Andre Camilleri
The Cost of Living Adjustment (COLA) would have been as high as €16 or €17 per week this year if it wasn’t for government subsidies, Finance Minister Clyde Caruana said on Monday.
Speaking in Parliament during adjournment time, XCaruana said that, although the European average for inflation is 20%, Malta has the lowest rates in the EU thanks to government subsidies.
The inflation has increased substantially due to the increasing economic pressures caused by the Russian invasion on Ukraine and other factors. In Malta, as said by Caruana, certain imported goods, fuels and energy are subsidised by the government.
“The load is being felt by all European countries and most of these European governments are offloading the weight of the recession onto the people. It is as though they did not learn from previous recessions.”
Caruana said that, by doing so, these governments are forcing their people to suffer twice, now, during the recession, and after, when their country tries to rebuild their shrunken economy.
“Malta is moving in a different direction, and if we did not and continue subsidising cereals, milk, fuels and energy, the cost of living adjustment would be between 16€ and 17€. This would result in employers paying €800 to €900€ per year per employee.”
Caruana said that this is a clear indication that the government is doing all it can to help people and businesses and mitigate the effects of this recession.
With regards to the longevity of the government continuing to subsidise as much as possible, Caruana said that what is owed to the government must be given to the government in order to keep the country as financially strong as possible.
“The money owed in taxes and so on is needed to safeguard the Maltese from suffering. I know that I may sound harsh and I know how people will perceive this, but imagine if we are not in a position to subsidise what I mentioned before. This relates in the financial strength of the country.”
In his closing statement, Caruana gave an update on the Air Malta situation in the previous months.
“Air Malta has reached 94% seat occupancy thanks to the measure proposed by Chairman David Curmi. When compared to the pre-pandemic rates of 2019, the rate was between 70 to 74%. Thanks to this, we are maximising the income of Air Malta and we have to continue taking the necessary measures needed.”